Corporate Overview Q3 FY 15

Transcription

1 Corporate Overview Q3 FY 15

2 Forward-Looking Statements Disclaimer Certain statements made in this presentation and the related materials may contain forward-looking statements, which are not historical facts, but are based on certain assumptions and reflect Enghouse s current expectations. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. These risk factors are identified in Enghouse s Annual Information Form and other periodic reports filed with applicable regulatory authorities from time to time. Enghouse disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Market and Industry Data This document contains certain statistical, market and industry data obtained from industry publications and reports. Industry publications and reports generally indicate that information has been obtained from sources believed to be reliable, but do not guarantee the accuracy and completeness of such information. Actual outcomes may vary materially from those forecast in such reports or publications, and the prospect for material variation can be expected to increase as the length of the forecast period increases. While we believe this data to be reliable, market and industry data is subject to variations and cannot be verified with certainty due to limits on the availability and reliability of data. Enghouse has not independently verified any of the third party data referred to in this document. 2

3 Snapshot HQ in Canada + 27 countries Toronto Stock Exchange TSX:ESL Dual Growth organic & acquisitions Enghouse Interactive Contact center software Enghouse Networks Telecom software Enghouse Transportation Transportation software employees Revenue Consistently profitable 3

4 Strategy Build a larger, more diverse enterprise software and services company through: Growing our interaction management solutions business Interactive Management Group Growing our network solutions and transportation management software businesses Asset Management Group Consistently generating revenue growth and positive cash flow Completing selective acquisitions within existing markets and entering new strategic software markets on an opportunistic basis 4

5 Interactive - Sector Dynamics Contact Center is at the front line of customer interaction, driving technology upgrades on premise and in the cloud IP migration, multi media routing and driving technology refresh Mobile computing/workforce driving significant multi-channel requirements Trend to in-sourcing contact centers due to increasing costs overseas and political/nationalistic pressures Traditional PBX market becoming increasingly commoditized, adoption of SaaS delivery model Microsoft s entry in the IP PBX could be a disruptive force (Lync Voice Platform) 5

6 Interactive Portfolio Leading customer interaction solutions, in the cloud, hosted or on-premise to address specific market requirements Consoles seats Channel GTM and OEM On-premises Mid-Market seats Channel GTM On-premises or hosted private cloud Enterprise s of seats Direct/Channel GTM On-premises, private cloud, or hybrid Cloud True multi-tenant cloud solution GTM through carriers and service providers Public, community, or private cloud 6

7 Interactive Portfolio Leading solutions to maximize the value of customer interaction MULTI-CHANNEL CONTACT CENTER Contact Center Enterprise Contact Center Service Provider Communication Center w/microsoft Lync Contact Center OnDemand Outbound Dialer ATTENDANT/OPERATOR CONSOLE Intuition Attendant Console (Avaya/Genband) Arc Pro Attendant Console for CISCO Operator Console for Microsoft Lync ANDTEK Console SELF-SERVICE Communication Portal Knowledge Management Suite QUALITY MANAGEMENT Call Billing and Reporting Enterprise & Cloud Call & Computer Recording Agent Evaluation Quality Management Suite Workforce Management System 7

8 Networks - Sector Dynamics BSS/OSS market was valued at $17B in 2011 and is expected to grow to $48.5B in 2018, a CAGR of 16% from (Source Transparency market Research) Highly fragmented, open for more industry consolidation among 400+ vendors Industry growth fueled by wireless subscriber growth and demand for smartphones, tablet devices and OTT applications Adoption of cloud and network virtualization will continue to gain momentum Big data and analytics technologies being deployed to tailor value-added services based on subscriber usage and behavior Continuing transition to next-generation network technologies and new service offerings while also dealing with customer services and retention 8

9 Networks Portfolio Technology solutions to optimize performance for next generation network operators FRAUD MANAGEMENT Real-time Predictive Analysis Profiling Dashboard Business Rules Engine GEOGRAPHIC INFORMATION SYSTEM Network Planning Rollout Design Engineering Visual Intelligence INTELLIGENT NETWORK SUITE Least Cost Routing Enhanced Toll Free Wholesale Number Portability Analytics MOBILE VALUE ADDED SERVICES Messaging Call Completion Rich Communications SERVICE DELIVERY CLOUD Billing Order Management Workflow CRM Service Catalog Provisioning WHOLESALE REVENUE MANAGEMENT Mediation Interconnect Roaming Trading Taxation Content 9

10 Transportation - Sector Dynamics Fragmented and competitive market. New technologies driving growth in systems and tangible cost benefits / savings Evolving tablet and smart phone technologies replacing traditional Mobile Data Terminals (MDT s). LTE networks to provide interoperability across geographies Cloud computing gaining momentum and driving replacement of legacy technology systems in a space traditionally slow to adopt Economic uncertainty and rising fuel costs driving increased ridership in both public and private sectors International political focus on terrorism and natural disasters driving continued investment in transportation and public safety systems 10

11 Transportation Portfolio Software based transportation and workforce management solutions for the public,privateandpublicsafetysectors TRANSIT OPERATIONS Fixed Route & Para-transit Scheduling Dispatch Workflow /Driver Management COMMUNICATIONS Fixed Route & Para-transit IVR Web Based Trip Planning PRIVATE TRANSPORTATION Coach and Tour Operations Management PUBLIC SAFETY Emergency Control Center & Dispatch (Police, Fire, Ambulance) Non-Emergency Patient Transport FLEET & TRANSPORTATION MANAGEMENT Logistics Management Order Tracking Telematics Container and Vehicle Tracking and Monitoring 11

12 ANNUAL RESULTS 12

13 Fiscal Year Results (ending Oct 31) TOTAL REVENUE $220m RECURRING REVENUE $115m $180m $92m $94m $123m $136m $47m $59m $72m 50% 48% 52% 51% 52% FY10 FY11 FY 12 FY 13 FY 14 FY10 FY11 FY 12 FY 13 FY 14 ADJUSTED EBITDA PER SHARE $2.09 DIVIDEND PER SHARE (based on date of record) $0.36 $1.69 $0.29 $1.26 $1.35 $0.18 $0.23 $0.85 $0.14 FY 10 FY 11 FY 12 FY 13 FY 14 FY 10 FY 11 FY 12 FY 13 FY 14 Note¹ : CAGR Compound annual growth rate 13

14 Revenue Split FY 14 REVENUE BREAKDOWN Hardware 3% Services 12% License 33% REVENUE BY GEOGRAPHY CANADA 4% APAC 7% US 33% Hosted/Mtce 52% EMEA 34% UK 22% REVENUE BY BUSINESS GROUP Asset Management Group $51m 23% Interactive Management Group $169m 77% 14

15 9 MONTHS -FY 15 15

16 9 months - FY 15 9 months FY 15 9 months FY 14 Revenue - increase of ~29% over FY 14 $203.0m $157.9m Revenue by Segment Interactive Management Group $136.7m $126.3m Asset Management Group $66.3m $31.6m License revenue $62.5m $52.8m Recurring revenue - increase of ~ 20% over FY 14 $99.7m $82.8m R & D expense as a % revenue 15.0% 17.1% Adjusted EBITDA¹ per diluted share - increase of ~ 25% over FY 14 $1.88 $1.50 Adjusted EBITDA¹ - increase of ~ 26% over FY 14 $50.9m $40.4m Note¹: Adjusted EBITDA: Results from operating activities adjusted for depreciation of PPE and special charges for acquisition related restructuring costs. 16

17 9 months - FY 15 9 months FY 15 9 months FY 14 Quarterly dividend - per common share, based on date of record $0.32 $0.26 Cash spent on dividend $8.4m $6.8m Cash spent on acquisitions (net of cash acquired) $27.3m $21.5m Cash & Investments balance - beginning of period $84.9m $90.3m Cash & Investments balance - end of period $91.3m $104.9m Acquisitions IAT IT Sonix Basset Nov 4 th March 4 th July 4 th CDRator Reitek March 3 rd May 8 th 17

18 Q3 FY 15 18

19 Q3 FY 15 Q3 FY 15 Q3 FY 14 Revenue - increase of ~ 28% over Q3 FY 14 $71.3m $55.5m Revenue by Segment Interactive Management Group $48.1m $44.6m Asset Management Group $23.2m $10.9m License revenue $21.8m $18.2m Recurring revenue - increase of ~ 15% over Q3FY 14 $33.8m $29.4m R & D expense as a % revenue 13.6% 16.0% Adjusted EBITDA¹ per diluted share - increase of ~28% over Q3 FY 14 $0.68 $0.53 Adjusted EBITDA¹ - increase of ~ 28% over Q3 FY 14 $18.5m $14.4m Note 1: Adjusted EBITDA: Results from operating activities adjusted for depreciation of PPE and special charges for acquisition related restructuring costs. 19

20 Q3 FY 15 Q3 FY 15 Q3 FY 14 Quarterly dividend - per common share, based on date of record $0.12 $0.10 Cash spent on dividend $3.2m $2.6m Cash spent on acquisitions (net of cash acquired) $6.8m $8.0m Cash & Investments balance - beginning of period $88.5m $101.0m Cash & Investments balance - end of period $91.3m $104.9m Acquisitions Basset July 4 th Reitek May 8 th 20

21 Quarterly Results REVENUE $ millions RECURRING REVENUE $ millions $80 $70 $60 $50 $40 $30 $20 $10 $0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 $40 $35 $30 $25 $20 $15 $10 $5 $0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY 12 FY 13 FY 14 FY 15 FY 12 FY 13 FY 14 FY 15 ADJUSTED EBITDA $ millions DIVIDEND PER SHARE (based on date of record) $20 $18 $16 $14 $12 $10 $8 $6 $4 $2 $0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 $0.14 $0.12 $0.10 $0.08 $0.06 $0.04 $0.02 $0.00 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY 12 FY 13 FY 14 FY 15 FY 12 FY 13 FY 14 FY 15 21

22 Acquisition Strategy Established track record of value creation through acquisitions To consistently generate positive operating cash flows to fund further growth and drive shareholder value Economic factors favorable for acquisitions especially for small-cap companies Target companies in the $5m - $50m revenue range preferably with strong recurring revenue Geographic, product or scale expansion Mission critical solutions High barriers to entry Objective is for a cash payback within 5-6 years 22

23 Recent Acquisitions IT SONIX March, 2014 Q2 FY 14 GERMANY BASSET July, 2014 Q3 FY 14 JINNY Aug, 2014 Q4 FY 14 IRELAND VOXTRON Oct, 2014 Q4 FY 14 CDRATOR March, 2015 Q2 FY 15 DENMARK REITEK May, 2015 Q3 FY 15 AKTAVARA Sept, 2015 Q4 FY 15 SWEDEN SWEDEN BELGIUM ITALY 23

24 THANK YOU! 24